Newcrest Mining is looking to divest more mine assets. It plans to turn two non-essential Queensland goldmines worth $370 million into one new company. The plans are to put Mount Rawdon and Cracow into a merger between Catalpa Resources and Conquest Mining with Newcrest retaining a 33% stake in the new entity.
The company has tried to sell its 70% stake in the Cracow mine before this but had failed. Despite needing approval from Catalpa Resources and Conquest Mining shareholders there is a good chance of the deal succeeding. The deal will also scuttle St Barbara’s takeover bid worth $350 million for Catalpa Resources.
This may not be the only divestment that Newcrest Mining is planning this year as per speculators. The third largest producer of gold in the world may also be looking to offload Bonikro mine in a similar deal. The Bonikro mine situated in Ivory Coast was acquired by the company through its $10 billion acquisition of Lihir Gold.
Whilst the mine itself is a profitable one, the political situation in the country has not allowed its potential to be met. The likely contender for a similar deal in Ivory Coast would be Perseus mining which already has tenement operations in the north of the country. Its main focus is the Tengrela gold project.
The deals would be profitable to Newcrest Mining allowing them to keep a stake in the mines and still be able to concentrate on its main areas of focus. If successfully implemented the company will see growth without much risk.